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2011 (9) TMI 280 - AT - Income TaxTDS u/s 194J - legal and professional fees, photography charges and bandwidth charges paid to the overseas parties - Held that:- as held by Hon'ble Supreme Court in the case of GE India Technology Centre Pvt Ltd. v. CIT (2010 -TMI - 77380 - SUPREME COURT OF INDIA), tax deduction at source obligations under section 195(1) arise only if the payment is chargeable to tax in the hands of non-resident recipient. Therefore, merely because a person has not deducted tax at source from a remittance abroad, it cannot be inferred that the person making the remittance has committed a failure in discharging his tax withholding obligations because such obligations come into existence only when recipient has a tax liability in India. - the ends of justice will be met by remitting the matter to the file of the Assessing Officer for examining, on merits, the taxability of these payments in the hands of the recipients, and with a direction to restrict the disallowance under section 40(a)(i) in respect of only such cases, if any, where the amounts remitted abroad have been held to be chargeable to Indian Income-tax Act.
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